Law

10:45 am

Thu June 28, 2012

Does Court's Rule Put End To Health Care Battle?

This is TELL ME MORE from NPR News. I'm Viviana Hurtado. Michel Martin is away. Still to come, we see how African-American lawyers fought civil rights battles in court even when the law cast them as second class citizens. That's in a few minutes.

But first we turn to today's historic Supreme Court ruling on health care. The justices upheld the Affordable Care Act, President Obama's signature health care legislation. We'll talk about the political implications of the ruling and what the ruling could mean for health care in this country. So we've called upon guests who've helped us break down this issue before.

Michael Cannon is the director of Health Policy Studies with the Cato Institute. That's a Libertarian think tank here in Washington, D.C. Also with us is Dr. Kavita Patel with the Brookings Institution. She's also a practicing physician at Johns Hopkins Medicine and she served in the Obama administration with the office of Intergovernmental Affairs and Public Engagement.

And also with me is NPR's senior Washington editor Ron Elving. Welcome to you all.

RON ELVING, BYLINE: Good to be with you, Viviana.

MICHAEL CANNON: Thank you for having us.

KAVITA PATEL: Thank you.

HURTADO: And we're going to start with Ron Elving. Can you tell us what was at the heart of the court's decision?

ELVING: At the heart of the court's decision is the issue of whether or not people can be compelled to have health insurance. And this particular bill said people would have to have health insurance or they would have to pay a penalty and the penalty would then in some sense or another compel them to do the responsible thing of having health insurance, which of course many people would be advised to do just for their own good.

But this would compel them to do it. And that this was within the powers of Congress and the president because it was covered by the Commerce Clause of the Constitution which permits the federal government to regulate certain kinds of activity or to, in this case, compel certain kinds of commercial activity over the states - now - and of course all the individual residents of all the states, all of us as Americans.

Now, what happened here in this decision that makes it a little complicated is that the idea of this being OK under the Commerce Clause was rejected by five of the nine Supreme Court justices, including Chief Justice John Roberts. But John Roberts wrote the majority opinion, saying that while the Commerce Clause was not a justification for compelling this commercial activity, it was OK because the penalty being imposed to force people to buy insurance is a tax.

It could be construed as a tax and therefore, the key component of this law survives constitutional test as a tax, an exercise of the normal taxing power of the federal government. That took a lot of people's breath away because we weren't expecting to hear that from John Roberts but that's what he decided to do.

And on the basis of that reasoning, it's a five-four decision upholding the act. There are other parts of the decision that constrict the way the act is enforced, particularly with respect to Medicaid, but that's the essence.

HURTADO: And we're going to get, actually, to the tax question in just a bit. Thanks, Ron. I want to turn right now to Dr. Kavita Patel. You were in the White House when the law was being worked on and I also note that you are a practicing physician. Can you explain to us what today's ruling means for patients?

PATEL: It's a huge victory for patients and everything about this law that patients really enjoy and have an opportunity to enjoy in the future have been critical to the ruling today, especially, for example, being able to keep your kids under the age of 26 on your insurance as a parent. Having seniors be able to afford prescription medications through the donut hole when they would have to normally pay out of pocket.

And then also the elimination of preexisting conditions and some of the other restrictions that we were concerned about if the law had been overturned.

HURTADO: And so Dr. Patel just said this is a huge victory for patients but I know, Michael, that you take a slightly different view. What are your thoughts?

CANNON: Well, this decision is actually a little bigger than health care, so I think the most important takeaway from the individual mandate part of the ruling is that the Supreme Court just ruled that it's OK for Congress to lie to the people when they're passing statutes.

HURTADO: And can you explain what you mean by lying?

CANNON: Congress said that this is a use of the commerce power. They said this is not a tax. The president went on national television, swore up and down this is not a tax. I debated people who said this is not a tax. And yet, the Supreme Court upheld it as what Congress said it was not.

What Congress said the mandate is, the Supreme Court said is not constitutional. What Congress said the mandate is not, the Supreme Court said is constitutional. So in the future, Congress will be able to do this. They'll be able to say this provision is actually one thing - they'll be able to say it's one thing and then have it upheld in order to get it past the voters, even though the voters wouldn't approve it if Congress were honest about it. But the law...

HURTADO: And I'm just going to let Ron Elving...

CANNON: But the law is also - the law is also going to increase health care costs now that it's on the books and looks like it's gonna be there for at least a little while, continue to throw people out of their health insurance and increase the deficit. So what's interesting about the Medicaid portion of this ruling is that it shows that states can actually stop the whole, all of the entitlement spending under this law.

HURTADO: And I want to give Ron Elving an opportunity to put a little bit of context here as to some of the assertions that Michael is making.

ELVING: I think Michael does make a point when he says that this bill was sold as one thing and justified as another by the court because even in the arguments that were put forward in March, when we had the oral arguments before the Supreme Court, the Solicitor General speaking for the federal government was still saying that this was an individual mandate under the Commerce Clause.

But there was a fair amount of talk even then in the oral arguments in March about how it functioned as a tax. This was an interest on the part of the justices. Clearly, it turned out to be a critical one. And there was a fair amount of discussion about, well, yes, it does function that way.

It's kind of that, you know, old saw about if it walks like a duck and quacks like a duck, it's a duck. And the justices were saying this looks more like a tax. Now, when we go back to the politics of the situation I think is where Michael has a point.

When this was going through Congress a few years ago there was a lot of feeling that you couldn't pass a new tax so it was described in other terms.

HURTADO: If you're just joining us, this is TELL ME MORE from NPR News. I'm Viviana Hurtado. We're talking about the Supreme Court's decision to uphold the Affordable Care Act. I'm joined by NPR - you just heard Ron Elving, Michael Cannon from the Cato Institute, and Dr. Kavita Patel of the Brookings Institution.

Dr. Patel, you actually think that this might be good fodder for Republicans, speaking of going forward, when we're just under six months away from an election.

PATEL: Yeah. There were already chants outside the Supreme Court this morning once it was announced that this was made constitutional as a tax to say repeal this tax. And I think that will be a predictor of the rallying cry across the country because of its function as a tax and the label as such.

HURTADO: And it's just interesting as well to note that outside of the Supreme Court it's a very colorful scene with both sides - supporters saying yes, we did and certainly as you noted, those who are opposed to it promising, vowing to repeal it. Michael Cannon, the same question for you. How do you think this is going to impact the bottom line how people get their health care coverage? You started to talk a little bit about that. I want to give you an opportunity to expand.

CANNON: Well, the law is not set in stone yet. I mean, it is statute and it's supposed to take effect in 2014 but a lot could happen to derail that and should happen to derail the law.

HURTADO: Do you see a lot of litigation coming up?

CANNON: There's still going to be a lot of litigation. For example, under this law the IRS has issued a regulation, a ruling, that says it's going to tax employers - that the statute does not authorize the IRS to tax but the IRS is doing it because the law will collapse without that employer mandate in place in states that don't create health insurance exchanges.

And so there's going to be litigation over that because that's essentially taxation without representation and yet, the law - the Obama health law - can't survive without the IRS taking that very unconstitutional step. There's also litigation about the independent payment advisory board under this law which is another, I think, unconstitutional part of this law.

Some have said that this entire law was upheld as constitutional. That's not the case.

HURTADO: And Dr. Patel, let's bring it to the people. Can you talk to us about any scenarios where patients are going to be hurt by this decision, by this law?

PATEL: I have been practicing and there is absolutely no way that I can see that keeping this law will hurt patients. This is...

HURTADO: Very briefly, Michael Cannon, I see you disagree.

CANNON: What this law is going to do is, if it takes effect in 2014, it's going to set back the cause of real health care reform for generations, so we're not going to see the sorts of innovations that will actually bring down the cost of care. We're going to continue to have this ossified health care sector where costs are continually rising and quality is not nearly what it should be.

HURTADO: Ron, how do you see it?

ELVING: I think we're going to probably be going through a period of time in which there is still uncertainty about what exactly the law is. It hasn't taken full effect yet and won't until 2014 and, even thereafter, there'll still be a great deal of adjustment.

What this decision has decided is that we are at least going to go forward with this experiment. We are not going to go backward to where we were in 2008, 2009. And that alone sets the cap, if you will, for insurance companies, for individuals, for our state governments that have to decide, how long are we going to resist this direction? How long are we going to continue to sue, as many will do, as Michael says, and when - at what point are we just going to say the future is arriving. We have to be ready for it. We're going to go forward with these new plans.

HURTADO: Of course, Ron, this is a very hot election year. Can you tell us - shed some light on how you see this is going to play out in the election?

ELVING: It's probably going to be highly energizing for some Republicans. I don't know how many of them were lacking any energy, however, before today. They were already angry about the law. They were already angry about many other things. They're going to be as energized as ever. I suspect, after this particular decision, perhaps we'll add a little bit to that. Perhaps, there'll be more money put into Republican campaigns by those who are outraged by this decision.

But I don't think that it's going to be very easy for Mitt Romney, given his history in Massachusetts when he had something very similar with a mandate and so forth to really make a lot of personal candidate hay out of this. I think it will probably lift a lot of conservative causes and a lot of conservative fundraising.

CANNON: I think it's inaccurate to say that this is just a Republican issue or this is just a conservative issue - I'm neither of those things - but the vast majority of independents wanted to see this mandate overturned and only 43 percent of Democrats wanted to see this law upheld in total the way it was.

ELVING: And Democrats are going to say - and other defendants of the law...

CANNON: This is a very...

ELVING: ...are going to say the individual mandate was not upheld. It was...

CANNON: It is a very...

ELVING: ...gotten rid of and the law is not construed in any way.

HURTADO: And as - and, as you can see, that we're...

CANNON: But does that mean that the Supreme Court repealed the individual mandate and replaced it with another law?

HURTADO: And, as you can see, there is certainly a lot of emotion and passion on this issue. Certainly, a lot more to talk about. Michael Cannon, who you just heard, is the director of health policy studies with the Cato Institute. That's a libertarian think tank here in Washington, D.C. Dr. Kavita Patel is with the Brookings Institution. She's also a practicing physician and she used to serve in the Obama administration. And Ron Elving is NPR's senior Washington editor. They all joined me in our D.C. studios.

Thanks to all of you.

PATEL: Thank you for having us.

ELVING: Thank you, Viviana.

CANNON: Thank you.

HURTADO: And this is a developing story, so please stay tuned to NPR and check out npr.org for more details. Transcript provided by NPR, Copyright NPR.